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Participation of Working Families, but Better Tracking of Efforts Is
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Report to Congressional Requesters:
United States General Accounting Office:
GAO:
March 2004:
FOOD STAMP PROGRAM:
Steps Have Been Taken to Increase Participation of Working Families,
but Better Tracking of Efforts Is Needed:
GAO-04-346:
GAO Highlights:
Highlights of GAO-04-346, a report to congressional requesters
Why GAO Did This Study:
Eligible working families are believed to participate in the Food Stamp
Program at a lower rate than the eligible population as a whole. As a
result, many federal, state, and local officials believe the program is
not living up to its potential as a component of the nation’s work
support system. This report examines: (1) what proportion of eligible
working families participate in the program and what family
characteristics are associated with a family’s participation; (2) what
factors may be acting as impediments to a working family’s decision to
participate in the program; and (3) what steps are being taken, or have
been suggested, to help eligible low-income working families
participate in the program while ensuring program integrity.
What GAO Found:
In 2001, an estimated 52 percent of eligible individuals in working
families participated in the Food Stamp Program compared with about 70
percent of eligible members of nonworking families.
Participating working families are more likely to receive greater food
stamp benefit amounts than those eligible working families that do not
participate. Also, participating working families were more likely to
participate in other government assistance programs and to rent rather
than own their home.
Factors that can impede an eligible working family’s participation in
the program include whether the family is aware of the program’s
existence and eligibility criteria and whether a family considers the
program’s administrative process—including having to make frequent
trips to a food stamp office during working hours and providing
documentation of income—overly burdensome. However, there are some
potentially significant benefits, including error and fraud prevention,
to some of the administrative requirements. Evidence also suggests that
some families weigh the perceived burdens of participation against the
benefits of doing so and perceive a stigma attached to receiving food
stamps.
The Food and Nutrition Service (FNS) and several states and localities
have taken or suggested steps to address the impediments to
participation in the program for working families, while also
considering ways to balance easier participation with program
integrity. These efforts include increasing food stamp outreach,
adopting new administrative processes to ease participation and reduce
program error, developing tools to help families estimate food stamp
benefit amount, and re-naming the program to reduce the stigma
associated with food stamps. Compiling a complete picture of these
steps was not possible, however, because FNS does not systematically
track these efforts, and the outcomes of their use are still largely
unknown.
What GAO Recommends:
GAO recommends that the Secretary of the U.S. Department of Agriculture
direct the Food and Nutrition Service to: (1) encourage states to
collect and report on the results of their outreach and other efforts
to increase participation among eligible working families and (2)
disseminate the lessons learned from those efforts to other states and
localities.
www.gao.gov/cgi-bin/getrpt?GAO-04-346.
To view the full product, including the scope and methodology, click on
the link above. For more information, contact Kay Brown at (202)
512-3674 or brownke@gao.gov.
[End of section]
Contents:
Letter:
Results in Brief:
Background:
Eligible Working Families Participate in the Food Stamp Program at a
Lower Rate than Eligible Nonworking Families:
Factors Related to a Family's Awareness and Perception of the Food
Stamp Program Influence Their Participation:
FNS and Some States and Localities Have Taken, or Suggested, Steps to
Help Working Families Participate in the Program While Ensuring Program
Integrity:
Conclusions:
Recommendations to the Secretary of Agriculture:
Agency Comments:
Appendix I: Methodology for Comparing Participating Working Families to
Likely Eligible Nonparticipating Working Families:
The Analysis Allows for Comparisons between Households with
Participating and Nonparticipating Working Families:
Appendix II: Summary of Farm Bill Provisions:
Appendix III: GAO Contacts and Acknowledgments:
GAO Contacts:
Acknowledgments:
Related GAO Products:
Tables:
Table 1: Characteristics That Are Associated with the Likelihood of
Food Stamp Participation:
Table 2: Recent FNS-Funded Outreach Activities Conducted by States,
Local Government, or Community-Based Organizations:
Table 3: Selected Results from Prescreening Tools Used by Community-
Based Organizations:
Table 4: Characteristics of Eligible Households with Earnings Used as
Factors to Predict Food Stamp Program Participation (Observed N=2,498;
weighted N=4,911,252):
Table 5: Odds Ratios Indicating the Effects of Various Factors on Food
Stamp Participation among Eligible Earning Households, from Bivariate
and Multivariate Logistic Regression Models (Observed N=2,498; weighted
N=4,911,252):
Figures:
Figure 1: Families Must Go through Several Steps to Receive Food
Stamps:
Figure 2: Food Stamp Recipiency Has Increased in the Last 2 Years,
Following a Substantial Decline:
Figure 3: More Food Stamp Recipients Now Live in Households with
Earnings than Households on TANF:
Figure 4: Participation Rates Are Lower for Working Families than for
Nonworking Families:
Figure 5: Estimated Food Stamp Benefits for a Single Mother with Two
Children Based upon Varying Amounts of Monthly Income:
Figure 6: Impediments to Participation Have the Potential to Impact
Each Step of the Food Stamp Process:
Abbreviations:
CHIP: Children's Health Insurance Program:
CPS: Current Population Survey:
EBT: Electronic Benefits Transfer:
EITC: Earned Income Tax Credit:
FSP: Food Stamp Program:
PRWORA: Personal Responsibility and Work Opportunity Act of 1996:
QC: quality control:
SIPP: Survey of Income and Program Participation:
SSI: Supplemental Security Income:
TANF: Temporary Assistance for Needy Families:
USDA: U.S. Department of Agriculture:
WIC: Special Supplemental Nutrition Program for Women, Infants, and
Children:
United States General Accounting Office:
Washington, DC 20548:
March 5, 2004:
The Honorable Tom Harkin:
Ranking Democratic Member:
Committee on Agriculture, Nutrition, and Forestry:
United States Senate:
The Honorable Patrick J. Leahy:
Ranking Minority Member:
Subcommittee on Research, Nutrition, and General Legislation:
Committee on Agriculture, Nutrition and Forestry:
United States Senate:
The Honorable John M. Spratt, Jr.:
Ranking Minority Member:
Committee on the Budget:
House of Representatives:
The Honorable Calvin M. Dooley:
Ranking Minority Member:
Subcommittee on Department Operations, Oversight, Nutrition, and
Forestry:
Committee on Agriculture:
House of Representatives:
The federal Food Stamp Program, established in 1964 and administered by
the U.S. Department of Agriculture (USDA), is designed to provide basic
nutrition to low-income individuals and families in the United States
by supplementing their income with food stamp benefits; however, many
individuals who are likely eligible to participate in the program do
not. According to USDA data, while an average of almost 16 million
Americans a month received food stamp benefits in fiscal year 2001,
almost 11 million individuals who were likely eligible to receive food
stamps in September of that year did not participate in the program.
Overall, the program paid almost $16 billion in benefits in fiscal year
2001.
Working families, defined here as those who live in households with
earned income, that are eligible to receive food stamps participate in
the program at a lower rate than the eligible population as a
whole.[Footnote 1] As a result, many federal, state, and local
officials believe that the Food Stamp Program is not living up to its
potential as a component of the nation's work support system. Work
support programs assist low-income working families by subsidizing some
of the expenses associated with work outside the home as well as
everyday necessities. These supports have grown in importance following
1996's welfare reform legislation, which placed a priority on work and
economic self-sufficiency. Although the Food Stamp Program's primary
mission is to ensure that low-income Americans have access to a healthy
diet, targeting food assistance to eligible low-income working families
also helps adults enter and stay in the workforce by freeing up limited
resources for other necessities.
USDA has made it a priority to increase working families' access to the
nutrition assistance they need, while at the same time ensuring that
only those who are eligible for benefits receive them. To better
understand how the Food Stamp Program serves working families, you
asked us to examine: (1) what proportion of eligible working families
participate in the Food Stamp Program and what family characteristics
are associated with a family's participation; (2) what factors may be
acting as impediments to whether a working family participates in the
Food Stamp Program; and (3) what steps are being taken, or have been
suggested, to help eligible low-income working families participate in
the Food Stamp Program while ensuring program integrity.
To answer these questions, we held discussions with program
stakeholders, including officials at USDA's Food and Nutrition
Service's (FNS) headquarters and regional offices,[Footnote 2] state
food stamp officials, representatives of advocacy organizations, and
other program experts. We also conducted a search of the literature to
identify recent (1996 or later) studies that specifically addressed
participation in the Food Stamp Program among eligible working
families. In addition, we analyzed simulated data prepared by
Mathematica Policy Research, Inc., to produce program participation
estimates for FNS. The simulated data are based on the most recently
available public data primarily collected by USDA and the U.S. Census
Bureau.[Footnote 3] Finally, we visited four states--Florida,
Massachusetts, New York, and Oregon--with programs identified by
federal officials, researchers, and other program stakeholders as
having innovative approaches to encouraging participation in the Food
Stamp Program among working families. During each of those site visits,
we met with the state officials responsible for oversight of the Food
Stamp Program, visited two local offices in different parts of the
state, interviewed advocacy groups charged with doing formal and
informal food stamp outreach for the state, and met with community-
based organizations that had frequent contact with food stamp
recipients as well as likely eligible individuals who were not
participating in the program. In addition, we reviewed documentation
about the rationale for, and the implementation of, state-and local-
level strategies to increase participation in the four states we
visited. We performed our work from May to November 2003 in accordance
with generally accepted government auditing standards.
Results in Brief:
About half of the individuals in working families who are eligible for
food stamps participate in the program, and certain family
characteristics, such as whether the family also receives other
government benefits, are associated with the likelihood of
participation. The rate of participation among the estimated universe
of likely eligible working families has hovered around 50 percent since
1997, and participation has consistently been much lower than the rate
of participation among members of likely eligible nonworking families.
For example, in 2001, an estimated 52 percent of eligible members of
working families participated in the program, and almost 70 percent of
eligible members of nonworking families did so. In 2002, participating
working families received an average of $210, per household, a month in
benefits, while participating nonworking families received an average
of $159, per household, a month in benefits. This difference is in part
because participating working families are, on average, larger than
participating nonworking families. Several family characteristics are
associated with the likelihood that working families participate in the
Food Stamp Program. Working families that participate in the program
are more likely to be eligible to receive greater food stamp benefit
amounts than those that are eligible but do not participate. In
addition, participating working families were more likely than
nonparticipating families to receive other government assistance and
were more likely to rent rather than own a home.
Several factors can act as impediments to a family's participation in
the program, including whether family members are aware of the
program's existence, their potential eligibility, and their perception
of the program based on our fieldwork and other studies. For example, a
program official in Oregon suggested that many working individuals in
that state assume that, because they have a job, their family is not
eligible for the program. In addition, some families choose not to
participate because they consider the administrative process--
including having to make frequent trips to a food stamp office during
working hours, completing the program application, and providing
documentation of income--too burdensome. Evidence also suggests that,
in deciding to participate, some families weigh the perceived burdens
of participation against the benefits of doing so to determine if
receiving food stamps is worth it given the size of the benefit and
their level of need. However, some of the administrative requirements
contribute to other priorities of the program, such as preventing fraud
and lowering error rates and targeting benefits to need, and highlight
the tension between the goals of increasing program access and reducing
error rates. A working family's perception of the stigma attached to
receiving food stamps is another factor influencing the decision to
participate. For example, former program recipients in Florida said
that some working families do not participate because they do not want
to go to the assistance office.
To help families, including working families, participate in the
program while ensuring program integrity, FNS and some states and
localities have taken or suggested steps designed to inform the public
about the program's existence and their potential eligibility, ease the
administrative processes, demonstrate the value of the benefit, and
reduce the stigma associated with food stamps. Compiling a complete
picture of these steps was not possible because FNS does not
systematically track these efforts, but our research identified several
noteworthy efforts. For instance, to increase awareness of the program,
FNS and some states and community-based organizations have advertised
the program to working families and others and run hotlines to respond
to questions about the program's rules. To help states ease the
perceived administrative burden associated with their programs, FNS has
provided guides that share with state and local offices some examples
of known efforts to improve program access. One such practice, tried in
California, was to extend office hours from 7: 00 a.m. to 9: 00 p.m. to
allow working families to visit without missing work. However, FNS did
not include in the guide any evidence that this effort was successful
or any lessons learned from this or other efforts. To demonstrate the
value of benefits to families, several states we visited used a Web-
based tool that allowed individuals to log on from personal computers
and, guided by questions regarding family characteristics, determine
potential eligibility and size of benefit. Other steps are being taken
to reduce the stigma associated with the program. For example, in
Miami, officials from a community-based organization gave presentations
to low-income workers at their place of work on the value of food
stamps as a work support. FNS officials have also discussed renaming
the program nationally, in order to reduce the stigma associated with
participation. At the same time states and localities are adopting
practices to help families participate in the Food Stamp Program,
officials also are mindful about their responsibility for ensuring
program integrity. For example, many states have adopted program
eligibility simplification options that have the potential to reduce
program errors while also easing the administrative burden on states
and working families. Finally, while the steps that have been taken or
suggested may help families participate in the Food Stamp Program, not
enough information on efforts underway or their outcomes is available
to determine whether they are effective at increasing program
participation.
To better target federal, state, and local outreach efforts; maximize
the benefits of the available outreach dollars; and identify and
eliminate impediments to food stamp participation, we recommend that
the Secretary of Agriculture direct FNS to: (1) encourage states to
collect and report on the results of their outreach and other efforts
to increase participation among eligible working families and (2)
disseminate the lessons learned from those efforts to other states and
localities. In its comments, FNS generally agreed with our findings,
conclusions, and recommendations.
Background:
The federal Food Stamp Program is intended to help low-income
individuals and families obtain a more nutritious diet by supplementing
their income with benefits to purchase food. FNS pays the full cost of
food stamp benefits and shares the states' administrative costs--with
FNS usually paying 50 percent--and is responsible for promulgating
program regulations and ensuring that state officials administer the
program in compliance with program rules. The states administer the
program by determining whether households meet the program's income and
asset requirements, calculating monthly benefits for qualified
households, and issuing benefits to participants, usually on an
Electronic Benefits Transfer (EBT) card. The program is usually
administered out of an assistance office and, oftentimes, assistance
offices also offer other benefits, including Temporary Assistance for
Needy Families (TANF), Medicaid, and child care assistance.[Footnote 4]
Figure 1 outlines the general steps a household must take to
participate in the Food Stamp Program and how each step occurs.
Figure 1: Families Must Go through Several Steps to Receive Food
Stamps:
[See PDF for image]
[End of figure]
Eligibility for participation in the Food Stamp Program is based on the
Department of Health and Human Services' poverty guideline for
households. In most states, a household's gross income cannot exceed
130 percent of the poverty guideline (or about $1,654 per month for a
family of three living in the contiguous United States) and its net
income cannot exceed 100 percent of the poverty guideline (or about
$1,272 per month for a family of three living in the contiguous United
States). In addition, most states place a limit of $2,000 on household
assets, and basic program rules limit the value of vehicles an
applicant can own and still be eligible for the program. Other factors
affecting benefit levels include size of household, income level,
shelter expenses, child care costs, and child support payments.
(Eligibility requirements are less stringent for households with
elderly or disabled members.) Participants must also periodically
recertify by documenting their continued eligibility for program
benefits.
In fiscal year 2003, the Food Stamp Program issued more than $21
billion in benefits. In September 2003, more than 22.7 million
individuals participated in the program. This is an increase from the
same month in 2002, when the Food Stamp Program provided benefits to
almost 19.8 million Americans. As shown in figure 2, the increase in
the average monthly participation of food stamp recipients in 2003
continues a recent upward trend in the number of people receiving
benefits.
Figure 2: Food Stamp Recipiency Has Increased in the Last 2 Years,
Following a Substantial Decline:
[See PDF for image]
[End of figure]
The decrease in number of recipients from 1996 to 2001 can be
explained, in part, by the passage of the Personal Responsibility and
Work Opportunity Act of 1996 (PRWORA), which toughened eligibility
criteria and made certain groups ineligible to receive benefits, and
had the effect of un-tethering food stamps from cash assistance. In
some cases, this caused participants to believe they were no longer
eligible for food stamps when TANF benefits were ended.[Footnote 5] In
addition, studies have suggested that the economic growth in the late
1990s played a major role in the decrease of recipients. Since 2000,
that downward trend has reversed, and stakeholders believe that the
downturn in the U.S. economy, coupled with changes in the program's
rules and administration, has led to an increase in the number of food
stamp recipients. Although the total number of food stamp recipients is
still below the 1996 level, since February 2001, the number of
recipients has increased over 30 percent.
Despite this increase, it remains the goal of FNS and several states to
increase participation in the program among eligible families, while
maintaining program integrity. FNS's fiscal year 2000 strategic plan
makes it a goal of the administration to improve the rate of food stamp
participation among all eligible people to 68 percent by 2005.[Footnote
6] According to FNS officials, eligible immigrants, elderly Americans,
and members of working families are the major subgroups targeted to
increase participation.
The administration has chosen to focus on participation among working
families, in part, because of the increased emphasis placed on the need
for work supports such as food stamps, the Earned Income Tax
Credit[Footnote 7] (EITC), and child care and transportation subsidies-
-since PRWORA.
In addition, the Farm Security and Rural Investment Act of 2002 (the
2002 Farm Bill) included provisions intended to encourage participation
among underserved groups, including working families, and simplify
program administration.[Footnote 8] For example, the 2002 Farm Bill
gave states the option to maintain food stamp benefits at a consistent
level for a transition period for individuals who left TANF to go to
work. The 2002 Farm Bill also made it possible for FNS to provide
financial awards to states with higher or improved performance in
program administration. In response, FNS has targeted improving program
participation in addition to its existing focus on payment accuracy and
lowering error rates. The food stamp error rate was 8.26 percent in
fiscal year 2002, the lowest in the program's history.[Footnote 9]
In the last few years, working families have become a greater
proportion of the overall food stamp participant population. As of
fiscal year 2002, about 40 percent of those individuals receiving food
stamps were members of households with earnings, up from about 33
percent in 1997. As shown in figure 3, this increase occurred at the
same time that the proportion of food stamp recipients receiving TANF
declined dramatically. This can be explained, in part, by the fact that
when TANF recipients leave that program, they may still be eligible for
food stamp benefits. Thus, if TANF recipients leave that program
because they have found employment, they can continue to receive food
stamps until their income increases enough to disqualify them from the
program or until they are no longer eligible for other reasons. Because
of the increase in the proportion of food stamp participants who are
living in households with earned income, serving low-income working
families has taken on an increased importance for the Food Stamp
Program in recent years.
Figure 3: More Food Stamp Recipients Now Live in Households with
Earnings than Households on TANF:
[See PDF for image]
Note: This figure depicts complementary trends in two groups of food
stamp recipients that are not mutually exclusive. In other words, TANF
recipients can also be employed and have earned income. In addition,
other individuals who are neither working nor receiving TANF may
receive food stamps as well, such as Social Security and unemployment
compensation recipients.
[End of figure]
Eligible Working Families Participate in the Food Stamp Program at a
Lower Rate than Eligible Nonworking Families:
A lower percentage of food stamp-eligible individuals in working
families received food stamp benefits than those in eligible nonworking
families, and certain family characteristics are associated with the
likelihood of participation. In September 2001, the most recent data
available, the participation rate of likely food stamp-eligible
individuals in households with earnings was estimated to be
approximately 52 percent. At the same time, estimated participation
among members of eligible nonworking families was almost 70 percent.
Despite their lower participation rate, the average participating
working family received a larger benefit than the average nonworking
family. The amount of food stamps a working family is eligible for
appears to be one of the major factors associated with the
participation of working families, with those families eligible for
larger food stamp benefits more likely to participate in the program.
Other characteristics that are associated with the likelihood of food
stamp receipt among working families include family size, amount spent
on shelter, and the marital status of the head of household. Finally,
working families that receive unearned income through other government
assistance programs are more likely to receive food stamps than those
with no unearned income.
Just Over Half of Members of Eligible Working Families Participated in
the Food Stamp Program in 2001:
In September 2001, an estimated 52 percent of individuals in eligible
working families participated in the Food Stamp Program, according to
an analysis done for FNS.[Footnote 10] In the same month, the
participation rate among all eligible individuals was estimated by FNS
to be 62 percent,[Footnote 11] and the rate among members of nonworking
families was almost 70 percent. As shown in figure 4, the participation
rate among working families has been relatively constant in recent
years--hovering around 50 percent--and it has consistently been lower
than the rate among nonworking families.
Figure 4: Participation Rates Are Lower for Working Families than for
Nonworking Families:
[See PDF for image]
[End of figure]
Participating Working Families Receive Higher Monthly Benefits than
Nonworking Families, and Benefit Amounts Vary Based on Family
Characteristics:
Among the families that receive food stamps, working families get
larger benefits than nonworking families. In 2002, working families
that participated in the Food Stamp Program received, on average, $210
a month in food stamps per household, according to information
collected by FNS.[Footnote 12] This amount is more than the $159
average benefit received by households with no earned income. The fact
that working families received more benefits, on average, than
nonworking families is, in part, due to family size. In general, the
larger the family size, the larger the family's benefit. Working food
stamp families have an average of 3.2 persons per household, as opposed
to nonworking families that receive benefits, which average fewer than
two persons per household. In addition to household size, household
income level also affects benefit level, as do other factors such as
cost of shelter, child care costs, and child support payments.
While it is true that the amount of food stamp benefits that a working
family is eligible for decreases as the family's gross income
increases, there is not an immediate drop-off in benefit level as
income increases, nor is there a one dollar drop in benefits for every
additional dollar in income earned.
To demonstrate the effect of additional earned income on working
families that receive food stamps, FNS provided us with an example of
how earnings might impact a hypothetical family consisting of a single
mother with two children. Figure 5 shows estimates of the amount of
food stamps for which this family would be eligible given varying
monthly income levels.
Figure 5: Estimated Food Stamp Benefits for a Single Mother with Two
Children Based upon Varying Amounts of Monthly Income:
[See PDF for image]
Note: To develop this estimate, FNS assumed that the mother worked; had
no unearned income, dependent care, or child support deduction; and had
a $300 a month shelter expense. FNS used the fiscal year 2002 Food
Stamp Program rules, specifically the value of the maximum food stamp
allotment for a family of three and the shelter deduction cap and other
assumptions as appropriate. In fiscal year 2001, the average earned
income for households with children was $351 per month so FNS used
multiples of that amount, ranging from one-half to four times that
amount to produce its estimates. The maximum allotment for a household
with three persons was $356.
[End of figure]
Certain Family Characteristics Are Associated with the Likelihood of
Participation:
Our data analysis shows that there are several characteristics that are
associated with an eligible working family's likelihood of
participating in the Food Stamp Program. To determine the family
characteristics that contribute to the likelihood of program
participation for eligible working families, we analyzed a database
produced by Mathematica Policy Research, Inc., of likely eligible
working families based on the March 2001 Current Population Survey
(CPS).[Footnote 13] This is the most current data available. Table 1
shows the differences between participating working families and those
we estimate are eligible but not participating in 2000, the last year
for which information was available.
Table 1: Characteristics That Are Associated with the Likelihood of
Food Stamp Participation:
Participating working families are more likely than eligible
nonparticipating working families to:
* Be eligible for higher monthly food stamp benefits;
* Have lower shelter expenses;
* Rent their home;
* Not have an elderly member in the household;
* Have a child under 5 in the household;
* Have a head of household that is divorced, separated, or single;
* Have citizen head of household;
* Have unearned income;
* Participate in other assistance programs (Women, Infants, and
Children, Medicaid, energy assistance, school meals, or job training);
Eligible nonparticipating working families are more likely than
participating families to:
* Be eligible for a lower amount of food stamp benefits;
* Have higher shelter expenses;
* Own their home;
* Have an elderly individual in the household;
* Not have a child under 5 in the household;
* Have a married head of household;
* Have noncitizen head of household;
* Have no unearned income;
* Not participate in other assistance programs.
Source: GAO:
Note: The characteristics listed correspond to effects found
significant at the 0.05 level in our statistical analysis. See appendix
I for a complete discussion of this work.
[End of table]
Some characteristics are associated with the increased likelihood of
participation. For instance, food stamp participation was more likely
among working families that were eligible for a larger amount of food
stamp benefits; specifically, each $100 increase in monthly benefits
for which families were eligible increased the likelihood of
participating in the program by approximately 30 percent. Working
families with young children--under 5 years old--in the household were
also more likely to participate than likely eligible working families
without young children.
Other characteristics are associated with the reduced likelihood of
participation. For example, working families with higher shelter
expenses were less likely to participate; each $100 increase in monthly
shelter expenses decreased the likelihood of participating by about 10
percent. In addition, working families that owned rather than rented
their dwellings, were less likely to participate in food stamps than
other working families, by about 50 percent. Families with a noncitizen
head of household, and families with elderly or married individuals in
the household, were also only about half as likely to participate in
the program.
Finally, families with any unearned income were more than 2 times as
likely as those without any unearned income to participate in the Food
Stamp Program. And, the likelihood of participating was almost 11 times
higher for those families that received Medicaid benefits than for
those who did not, over 6 times higher for those who received energy
assistance and over 4 times higher for households in which someone
received job training. Similarly, the likelihood of participating in
the Food Stamp Program was about 3 times higher for working families
participating in free or reduced school lunch program or in the Special
Supplemental Nutrition Program for Women, Infants, and Children (WIC)
than for those eligible nonparticipating working families that did not
participate in those programs.
In assessing the results of our analysis, it is worth noting that some
of the characteristics that are associated with the participation by
likely eligible working families also are likely to be associated with
the participation of all eligible participants. For this study,
however, the analysis focuses on how these characteristics are
associated with working families. By focusing on the differing
characteristics of participating and nonparticipating working
families, it is possible to develop a better understanding of how
working families that receive food stamps are different from likely
eligible working families that do not receive benefits. This analysis
does not, on its own, offer any explanation for why these families
choose to participate, but it does help identify characteristics of
those families who do and do not participate. The analysis also
provides additional support for how certain impediments we identified
can affect a working family's decision to apply for and receive food
stamp benefits. The following section elaborates on those factors.
Factors Related to a Family's Awareness and Perception of the Food
Stamp Program Influence Their Participation:
Several factors may impede an eligible working family's participation
in the Food Stamp Program, according to our fieldwork and literature on
the subject. Among them are whether the family is aware of the
program's existence and the family's possible eligibility, the family's
willingness to deal with the program's administrative process, whether
the family judges the amount of food stamp benefits received to be
worth the effort and cost of participating in the program, and the
extent to which the family associates a stigma with food stamp receipt.
Figure 6 shows how these factors interact with the steps necessary for
a working family to receive food stamps.
Figure 6: Impediments to Participation Have the Potential to Impact
Each Step of the Food Stamp Process:
[See PDF for image]
[End of figure]
Participating in the Food Stamp Program Depends on a Family's Awareness
of the Program and Eligibility Criteria:
To receive food stamps, a family has to apply for the benefits, a step
which is taken, generally, by a member of the family going to a local
assistance office and filling out an application. Participation,
therefore, is dependent on the family being aware of the program's
existence and its possible eligibility. Yet, studies of participation
in the program that we reviewed offer evidence that many eligible
families lack such awareness. For example, a study done by Mathematica
Policy Research, Inc., for FNS, based on interviews with likely
eligible individuals that do not participate in the program, found that
72 percent of those surveyed were not aware of their probable
eligibility.[Footnote 14]
Program stakeholders, too, said that lack of information about the
program and how it works plays a key role in nonparticipation for
working families. For instance, according to officials in Florida,
working families may not participate because they are uncertain about
the program's rules and eligibility criteria and how to participate. A
worker for a community-based organization in Florida who did outreach
to working families said that many individuals are unfamiliar with the
program's workings, making food stamp receipt difficult.
Program officials also suggested that many working individuals assume
that their having a job makes their family ineligible for the program.
As one official in Oregon said, she believes that some working people
do not think of themselves as food stamp recipients, because they
believe that food stamps are something for the very poor, and thus do
not think they would be eligible given that they have jobs. Officials
in Florida and Massachusetts agreed that some potentially eligible
working families do not participate because they do not know that they
are potentially eligible for food stamps.
Confusion about the relationship between food stamp eligibility rules
and TANF eligibility rules can also contribute to working families
wrongly believing that they are ineligible for food stamps, according
to program officials that we talked with. An official for the New York
Office of Transitional and Disability Assistance said that some people
still believe that when one's TANF case closes, one's food stamp case
closes as well. The official said that, despite New York's best effort
to combat this false information, some people leave the Food Stamp
Program when they leave TANF because they believe that they are no
longer eligible for food stamps.
The Perception that the Food Stamp Program's Administrative Process Is
Burdensome Can Deter Participation:
Another factor influencing whether a family participates in the Food
Stamp Program is how the food stamp administrative process is
perceived. In other words, according to the literature we reviewed and
the program officials we spoke with, if the administrative process is
seen as being burdensome, families may not participate because of the
effort required to apply for and receive food stamps. In addition, our
analysis of CPS data demonstrates that, in 2000, working families that
participate in the Food Stamp Program are more likely to receive other
types of government assistance--such as Medicaid, WIC, and energy
assistance--than nonparticipating working families. One possible
explanation for this difference is that those that have a comfort level
with the administrative process of applying for and receiving
assistance might be more likely to participate in the Food Stamp
Program.
We identified certain administrative practices during our site visits
to food stamp offices in Florida, Massachusetts, New York, and Oregon,
that could be considered burdensome by potential recipients who work
and that might deter participation. Among the practices identified were
multiple required office visits, food stamp office operating hours,
food stamp applications, requirements for eligibility documentation and
verification, finger imaging for program participants, and the
requirement for workers to report changes in their income and hours
worked. However, we found that not all of these practices that are
potential impediments to participation were in place in every local
office that we visited and that these practices are not in place in
exactly the same fashion at each office. In addition, it is clear that
there are potentially significant benefits--including fraud and error
prevention, targeting benefits to need, and the provision of more cost-
effective service--to some of the administrative processes.
Among the practices that can influence whether a family participates in
the Food Stamp Program are:
* Required office visits. In some cases, potential recipients make a
trip to the assistance office to fill out a food stamp application and
a separate trip for the recipient to meet with a caseworker to
determine eligibility. In addition, potential clients may have to
return to the food stamp office if they do not bring all the required
documentation to their first visit. This means that a family often has
to make two or more trips to the office to participate in the program,
which can be difficult for individuals who are working.
* Office hours. Assistance offices are often only open during regular
working hours. For example, we visited an office that opened from 8: 30
a.m. to 4: 30 p.m. from Monday to Friday. For working individuals,
getting to a food stamp office during the work week can be difficult. A
recent study by the Urban Institute supports the notion that a working
families' participation status is influenced by the hours they work
and, perhaps, by the hours a food stamp office is open.[Footnote 15]
The study found that those who work so-called traditional hours are
less likely to participate than those who work a less traditional
schedule. However, offering longer hours of service can have cost
implications such as additional personnel, utility, computer, and
security costs.
* The food stamp application. During our site visits, program advocates
said that applications, which often serve both food stamps and other
assistance programs, such as Medicaid and TANF, are too complex. For
instance, an advocate said that she believed that the food stamp
application was too long and required a reading level that was too
advanced for most potentially eligible individuals. State officials in
Oregon, however, said that having a slightly longer food stamp
application allows for better integration of assistance programs, which
can benefit recipients, as well as a reduction of workload for
caseworkers at assistance offices.
* Eligibility documentation and verification. Participating in the
program requires proof of income level, residency, and family size,
among other information. Providing such proof usually is done by
bringing documentation to the food stamp office at the time of
enrollment. This, however, can be perceived as being burdensome for
potential clients. For example, current and former food stamp clients
surveyed in an Oregon focus group reported that various documentation
forms in that state are intrusive and often excessive. However, under
current program rules, these requirements are an essential component of
ensuring that food stamp applicants are eligible to receive food stamps
and that they receive the proper benefit amount.
* The finger-imaging requirement. Four states in the country have
requirements that new recipients of food stamps are finger-imaged at
the assistance office before they receive their benefits.[Footnote 16]
New York was the only state we visited that had such a requirement.
Advocates in that state complained that being finger-imaged was a
deterrent to participation, in that it potentially required them to
make an additional trip to the food stamp office. However, quality
control officials in that state believed that it was a vital way to
prevent people from defrauding the Food Stamp Program by allowing
officials to verify that the applicant did not already have a case open
somewhere else in the state.
* Change reporting requirement. Participating in the program often
requires families to report income changes, meaning that some working
families would have to be in frequent contact with their caseworker as
the amount of hours they worked or the wages they received fluctuated.
The requirement has the potential to add to the burden of
participation, and program officials said that the requirement was a
potential deterrent for working families. However, doing so also
ensures that food stamp recipients continue to receive the correct
benefit amount. These income changes can result in either an increase
or decrease of benefit levels.
Government officials we talked with acknowledged that the food stamp
administrative process can be burdensome and that participating in the
program is complex. However, officials spoke positively of many of the
practices in their states, such as finger imaging and the requirement
for multiple office visits. Many of the practices that might be
perceived by potential recipients as causing burdens contribute to
other priorities of the program, such as streamlining the eligibility
process and keeping the program's error rate as low as
possible.[Footnote 17] The perceived impediments associated with many
of the administrative processes, and the justifiable reasons the
processes exist, highlight the tradeoffs between the various program
goals, including increasing program access and reducing error rates,
that are inherent with the design of the Food Stamp Program. Some of
these practices probably contribute to some eligible working families
not participating in the program, but they also probably help to ensure
that only eligible families receive benefits, which is vital to
maintaining public support for the program.
Evidence Suggests that Food Stamp Participation Is Often Driven by
Whether a Family Considers the Benefits Worth the Effort and Cost of
Participating:
Another factor influencing whether eligible working families
participate in the Food Stamp Program is how much they value the food
stamp benefit, according to evidence from available public data, the
literature we reviewed, and visits to four states. Working families may
make an informal cost-benefit analysis of whether their need for the
benefits they would receive outweighs the effort and cost of
participation. Costs can include taking time off from work and the
transportation costs of getting to a food stamp office. Our analysis of
2000 CPS data--which demonstrates that working families that receive
other government assistance are more likely to participate in the Food
Stamp Program--is consistent with that. Given that many assistance
programs are administered at the same office and sometimes using the
same application as food stamps, participating in other programs is
likely to reduce the cost of food stamp participation, which makes a
working family more likely to participate in food stamps.
Our analysis of the 2000 data also demonstrates that working families
that are eligible for larger benefits are more likely to receive food
stamps than those that are eligible for smaller benefit amounts.
Program officials also cite the amount of benefits as a reason that
some working families do not participate. An official in Massachusetts
said that some working families may qualify only for a small dollar
amount a month, which our evidence supports, and, because of that fact,
some potential recipients believe that the effort associated with
applying is not worth the small amount.
In addition, available research shows that whether a family is willing
to participate in the program can also be influenced by the extent to
which the family believes it needs the benefit. In a survey and focus
groups Mathematica Policy Research, Inc., conducted for FNS, it found
that many likely eligible working families did not participate because
they believed that they could get by without food stamps and that
others need them more.[Footnote 18] Such families seem to be placing a
minimal value on their food stamp benefit. Moreover, research done by
USDA's Economic Research Service suggests that families that are food
insecure[Footnote 19] are more likely to participate than families that
are food secure.[Footnote 20] Both of these research efforts suggest
that a family's level of need plays a role in whether a working family
participates in the Food Stamp Program. Those families believe that
they do not need food stamps are less likely to bear the costs of
participating in terms of lost time and inconvenience, while those
families that are in need may be more likely to participate no matter
what the benefit level is.
A study published by The Lewin Group reinforces the idea that need
plays a role in the decision to participate.[Footnote 21] In a study
using data from the Survey of Income and Program Participation
(SIPP),[Footnote 22] the authors found that likely eligible
nonparticipating working households differed from participating
working households in their income variability. Nonparticipating
households were more likely to have experienced a short-term drop of
income than participants and were more likely to have had recent past
income that exceeded 100 percent of the federal poverty level. From
these findings, the authors suggest that many nonparticipants have
expectations of higher future income and do not see the need for food
stamps, which helps to explain why they do not participate.
The Stigma Associated with the Food Stamp Program Can Cause Some
Families Not to Participate:
The stigma associated with the Food Stamp Program is one of the reasons
some eligible families do not participate in the program, according to
existing research and interviews with program stakeholders. Although
the program's primary mission is nutrition assistance, program
stakeholders believe the stigma associated with food stamps is largely
related to the program's welfare connotations. Focus groups of current
and former food stamp recipients, conducted by a community-based
organization in Oregon, echoed that sentiment. A theme that ran through
the focus group responses was that people were ashamed, or too proud,
to receive food stamps. The focus group responses indicated that
individuals can have personal shame about receiving food stamp benefits
and may be worried about being looked down upon for receiving them.
For working families, the welfare stigma can be a particular deterrent
toward food stamp participation. For example, program officials cited
the occasional need to verify a food stamp recipient's wages and
employment status with the recipient's employer as one stigma
associated with food stamp receipt for working families. A related
deterrent for working families is that to participate in the program, a
family usually has to make a trip to the food stamp office, which is
also the "welfare office." Advocacy groups said that this was a
requirement that discouraged participation among working families.
Former Florida food stamp recipients told us that caseworkers ask
personal questions regarding how they manage their finances. For
example, how one pays for hair care and laundry, which they considered
intrusive and made them less likely to participate in the program.
However, local officials in Florida said that these questions are an
effective method to deter program fraud and ensure that food stamp
benefit amounts were provided accurately.
Measuring the extent of stigma can be difficult, because stigma is
often a personal matter. Many of the officials we spoke with said that
the move toward EBT cards has helped alleviate the stigma of the
program for working families and others by making food purchases by
program recipients look more like ordinary food purchases, thus making
it more difficult for other shoppers at grocery stores to identify food
stamp recipients' purchases. Still, many of the same officials said
that stigma remains an issue.
FNS and Some States and Localities Have Taken, or Suggested, Steps to
Help Working Families Participate in the Program While Ensuring Program
Integrity:
FNS and the states and localities we visited have taken or suggested a
variety of steps to address identified program impediments that may
hinder the participation of working families in the Food Stamp Program.
These efforts include informing the public about the availability of
food stamps, easing the administrative processes, estimating
eligibility and the potential size of benefits, and reducing the stigma
associated with food stamps while also adopting strategies to ensure
that serving working families does not jeopardize program integrity.
Several Efforts Are Underway to Better Inform the Public about Food
Stamp Availability and the Program's Eligibility Criteria:
Several federal, state, and local efforts are in place to make
information about the Food Stamp Program available to potentially
eligible working individuals. These include efforts to inform the
public through outreach efforts, such as media campaigns, and to reach
potential program participants in locations where they are likely to
be, such as their places of employment. While officials we spoke with
were hopeful about the ability of these efforts to reach the right
audience, little outcome data are available to determine which outreach
efforts are most effective.
FNS Outreach Grants and Guides:
FNS has provided some specific grants to states and organizations to
conduct food stamp outreach; however, FNS does not know the total
amount of other funds states spend on outreach. In fiscal years 2001
and 2002, FNS awarded 100 percent funded competitive outreach grants to
state-and community-based organizations.[Footnote 23] Some of these
grants specifically targeted working families while others targeted all
low-income families. The impact of these grants are largely unknown to
date, although FNS is conducting assessments. Because the grants are
awarded to address local needs, FNS officials reported that they do not
expect major findings on ways to improve service to working families,
but do expect results to reveal potentially effective ways to do
localized outreach. In addition, FNS also recently awarded competitive
program participation grants made available by the 2002 Farm Bill to
agencies or universities. The goal of these grants is to improve the
food stamp application process and work to identify and eliminate
barriers to participation. FNS will in addition, pay for half of any
outreach effort funded by the states. Some of these efforts are
formalized through an approved outreach plan, and the funds spent on
them are reported separately. Other state outreach efforts, however,
may be conducted without FNS's knowledge and claimed as an allowable
administrative expense but not separately identified as outreach in the
states' fiscal reports according to an FNS official. Table 2 provides
more information about the known outreach efforts.
Table 2: Recent FNS-Funded Outreach Activities Conducted by States,
Local Government, or Community-Based Organizations:
Type of outreach effort: State outreach plan;
Fiscal year: 2002;
FNS percentage funding rate: 50;
Number of states: 14;
Total funding (dollars in millions): $8.8[A].
Type of outreach effort: Outreach grant;
Fiscal year: 2002;
FNS percentage funding rate: 100;
Number of states: 19;
Total funding (dollars in millions): 5.0.
Type of outreach effort: Program participation grant;
Fiscal year: 2003[B];
FNS percentage funding rate: 100;
Number of states: 5;
Total funding (dollars in millions): 5.0.
Source: FNS.
[A] States or community-based organizations paid $4.4 million of this
amount.
[B] The 2002 Farm Bill allows USDA to award up to $5 million per year
for fiscal years 2003 through 2007 to entities to carry out projects to
simplify food stamp application and eligibility determination and to
improve access to food stamp benefits.
[End of table]
FNS regional offices also conduct program access reviews of selected
local offices in all states to determine whether state and/or local
policies and procedures served to discourage individuals from applying
for food stamps or whether local offices had adopted measures to
improve customer service. Some of these measures are gathered into a
periodic best practices guide published by FNS.[Footnote 24] The guide
contains information about the goal of the practice being tried, the
number of places where it is in use, and contact information for a
person in these offices. For the most part, however, the guide does not
include any evidence that these efforts were successful or any lessons
learned from these or other efforts.[Footnote 25]
Efforts to Inform the Public:
FNS is launching a $4 million, nationwide radio food stamp promotion
campaign to raise awareness about the benefits of the Food Stamp
Program. The goals of the campaign are to position the program as a
nutrition assistance and work support program and improve the public's
understanding of the program's purpose and who may be eligible,
including working families. Transit ads and radio spots have been
developed and will be placed in key locations throughout the nation,
promoting the national or state toll-free Food Stamp Program numbers,
as appropriate.
The ads will refer potential food stamp recipients to either FNS's or
the state's telephone hotline to receive information about the Food
Stamp Program. In 2003, the FNS bilingual (English and Spanish) hotline
averaged about 1,900 calls per month according to FNS.[Footnote 26]
Some states have also launched media campaigns. For example, in New
York, as part of its approved outreach plan, efforts were underway to
garner interest in the program in the form of a statewide, $300,000
media campaign and a $500,000 media campaign for New York City. In
addition, in each of the four states we visited, either the state-or a
community-based organization had established a hotline to provide
broader outreach to potential clients and to make them aware of program
eligibility requirements and the documentation they need to apply for
benefits. For example, from September 2001 to June 2003, the Community
Food Resource Center in New York City fielded over 110,000 calls from
59,000 individuals requesting food stamp assistance. The center
reported that these calls resulted in 3,240 new food stamp cases. Other
media outreach efforts, both statewide and local, included advertising
on television and radio, posters, and shopping bags and in newspapers
and direct-mail supplements. Many of these broad outreach efforts were
not specifically targeted to working families, but since some working
families may not believe they are eligible for food stamps, these
efforts may help to make them aware of the eligibility requirements,
promote the image of the Food Stamp Program as a nutrition assistance
program, and inform families what they have to do to apply for
benefits.
Efforts to Reach Eligible Working Families:
Some efforts are made to reach working families specifically by making
applications and informational materials available where eligible
working families are likely to go, such as at tax preparation sites,
health clinics, supermarkets, WIC centers, and food pantries. For
example, FNS has partnered with H&R Block to promote food stamps to
those families who qualify for the EITC, which can indicate eligibility
for food stamps. FNS officials said this effort resulted in an
increased number of calls to their hotline during the tax season. FNS
plans to expand this type of partnership further to tax preparers at
the Voluntary Income Tax Assistance Program.[Footnote 27] In Oregon, we
spoke with a food stamp worker who is regularly stationed in a local
food pantry. She noted that many working people are more comfortable
coming to the food pantry to apply for food stamps because government
food stamp offices can be off-putting to some people. She estimated in
the last 2 years she has done 1,000 intakes at the food pantry.
However, food stamp officials in all four states cited problems with
tight state budgets resulting in staffing freezes or cuts. As a result,
some offices have cut back on such resource-intensive practices.
Food stamp advocates have also worked with employers whose employees
would likely be eligible for benefits. For example, in Miami, the Human
Services Coalition of Dade County, as part of the Greater Miami
Prosperity Campaign, is attempting to reach out to employers of low-
income workers to promote certain available work support programs for
their employees. The goal is to convince employers that these work
supports are a win for employees because they augment the wages of low-
income workers; they are a win for employers, because they bring
stability to the life of their employees who, therefore, feel more
loyalty to their employer; and, they are a win for the community at
large, because more federal dollars are brought into the local economy
through the spending of those who receive work supports.
Representatives of the coalition and its partners are working with the
Greater Miami Chamber of Commerce and are making presentations to
employers and their low wage employees and human resource manager
associations around the region focusing on this message.[Footnote 28]
The coalition representatives ask employers to take three actions to
support the campaign: (1) send letters to employees about available
work supports; (2) provide information about the EITC, children's
health care, and food stamps when sending out copies of government
documents such as Internal Revenue Service W-2 earning statements; and
(3) allow coalition workers to pre-screen employees at the workplace.
The prescreening allows the advocates to more fully explain the
eligibility requirements and what steps applicants must take to qualify
for benefits. As of August 2003, the advocates had convinced a large
Miami-based cruise line to send out information about the work support
programs with employees' W-2 forms and pay stubs, and they had also
conducted on-site pre-screening for employees at several local
businesses.
Some state and local programs we visited have also partnered with other
assistance programs, such as the EITC, Medicaid, Head Start, school
lunch program, and WIC, to make working and nonworking families aware
of their potential eligibility for food stamps. Stakeholders spoke
highly of such efforts, and as previously discussed, our analysis of
simulated data show that the likelihood of working families
participating in the Food Stamp Program was much higher if they
participated in other assistance programs as well. Finally, our
previous work also showed that 26 states are conducting food stamp
eligibility interviews in at least some of their Workforce Investment
Act one-stop centers.[Footnote 29]
In addition to the outreach efforts that have been tried, one local
official suggested that food stamp outreach could be greatly expanded
if the state used taxpayer records to identify potentially eligible
working families. Adopting such a strategy, however, could be
problematic because of the need for state human service agencies and
departments of revenue to coordinate with one another, as well as
privacy concerns over the use of tax data.
Several Efforts Are Underway to Simplify the Administrative Process:
States and local offices we visited have adopted a number of different
practices to make administrative processes less burdensome on potential
participants. Among the efforts that resonated particularly with
working families were those intended to save participants' time and
allow them to fulfill program requirements to ensure only eligible
families receive benefits in ways that minimize their need to miss
work. While officials we spoke with were hopeful about these efforts,
little outcome data are available to determine their effectiveness at
easing administrative burdens.
Steps to Facilitate the Application Process:
States and local offices we visited have adopted a number of different
practices to facilitate the food stamp application process. Oregon and
Florida have adopted a "no wrong door policy" that allows people to
apply for benefits at any food stamp office, and states with Web sites
have placed food stamp applications on the Web, which is a requirement
of the 2002 Farm Bill.[Footnote 30] In addition, New York, Oregon, and
Massachusetts shortened and simplified their food stamp applications.
While well received, shortening the application has had some drawbacks.
For example, New York officials told us that because their shortened
application was for food stamps only, it limited the client's ability
to apply for more than one assistance program at the same time. Also,
local officials in Oregon told us that their shortened form required
their already overburdened caseworkers to spend more time with clients
gathering information previously captured on the longer application
forms.
States are also facilitating the food stamp application process by
adopting certain available administrative options that can simplify the
application process. For example, when considering the value of a
vehicle as an asset, states may choose to substitute the more generous
asset rules from other assistance programs in place of Food Stamp
Program rules thereby reducing the amount of documentation collected
from individuals applying for more than one program. All four states we
visited have adopted similar vehicle policy options. All four states
have also adopted an option that allows certain families with incomes
up to 200 percent of the poverty level to be automatically eligible for
the Food Stamp Program.[Footnote 31]
Several states have experimented with alternative practices to
requiring applicants to come to the food stamp office during
traditional office hours. Three local offices we visited experimented
with offering extended office hours during the week or on Saturdays.
State and local officials reported mixed success with these options.
For example, officials at one local office in Oregon said that adopting
client friendly policies such as these has led to an increase in the
caseload while local officials in New York and Massachusetts dropped
these efforts after few potential clients took advantage of the
extended hours. In addition, in an effort to help working families
avoid missing work and overcome transportation impediments,
Massachusetts adopted liberal rules allowing local offices to interview
clients and take food stamp applications over the telephone or via the
mail if coming to the office would be a hardship for them. Using this
practice, clients still must submit the necessary documentation to
ensure program integrity. In the period from November 2002 to June
2003, over 5,000 food stamp applications were received through the
mail.
Steps to Facilitate Continuing Program Participation:
Some states have taken advantage of options to simplify on-going
reporting requirements. Typically, working families were expected to
report earned income changes. FNS was concerned that the increase in
employment among food stamp households would result in larger and more
frequent income fluctuations, which would increase the risk of payment
errors and be burdensome for the working poor. As a result of these
concerns, FNS established regulations in November 2000 that gave states
the option to require working families to report changes in income
between 6 month certification periods only when a change in their
income made them ineligible for food stamps. All of the four states we
visited chose this option.[Footnote 32] In addition, FNS continued to
support efforts to further expand states' flexibility to streamline
complex rules, simplify program administration, and help ease the
transition from welfare to work through their support of the 2002 Farm
Bill amendments. For example, the 2002 Farm Bill simplifies on-going
reporting requirements by allowing states to disregard changes in
certain amounts deducted for child care expenses, child support
payments made, and medical expenses.[Footnote 33] One of our four
states, New York, has chosen this option. Finally, Oregon has
simplified on-going participation by allowing clients to recertify
their program eligibility via the mail rather than by requiring face-
to-face interviews.
For families who are leaving cash assistance, the 2002 Farm Bill also
allows states the option of facilitating continued program
participation by providing 5 months of automatic transitional food
stamp benefits when a family leaves the TANF program without requiring
the family to reapply or submit any additional paperwork. Of our four
states, Massachusetts, New York, and Oregon have adopted this
option.[Footnote 34]
Finally, because application and continuing program participation
impediments can vary from state to state and from locality to locality,
some states and localities have established working groups of program
stakeholders to identify program impediments and to generate ideas on
how to remove them. For example, the Oregon Hunger Relief Task Force
established a committee of officials from the state Department of Human
Services and other state agencies, community advocates, food bank
representatives, local office workers, and former recipients to assess
program access and participation issues. These efforts have opened the
lines of communication and have been deemed successful by both the
state officials and advocates we interviewed.
Efforts Are Underway to Estimate Eligibility and the Size of the
Potential Food Stamp Benefit:
Some program advocates and officials have taken steps to develop ways
to reach people who may have the wrong impression about their
eligibility and the size and value of food stamp benefits. While the
usage of these tools shows promise where they have been put into place,
the final outcomes of their use are still largely unknown.
Steps to Show People the Amount of Their Estimated Benefit:
FNS's Web site has a pre-screening tool that allows individuals to log
on from personal computers and, guided by questions regarding family
characteristics, determine their potential food stamp eligibility and
the size of their benefit. FNS, however, has not yet started to track
how often this tool is used. Some experts we spoke with suggested that
such Web-based tools are most effective when a third party, such as a
program advocate, is available to help potential clients use them.
We visited three community-based organizations that had prescreening
tools available to help individuals determine their eligibility and
estimate their benefits. Project Bread, located in Massachusetts, uses
a Web-based tool similar to FNS, while Florida Impact and the Community
Food Resource Center in New York City send staff members with laptops
to sites where likely eligible people are found--including emergency
food programs or pantries, WIC centers, health clinics, hospital
lobbies, unemployment offices, supermarkets, and senior centers--to
prescreen potentially eligible clients. The Community Food Resource
Center's prescreening tool collects client information, estimates their
potential food stamp benefits, and prints out a document guide listing
the documents necessary to apply. This estimated benefit information
allows the client to decide whether the potential benefit would
outweigh the perceived burden of following through with the application
process. Table 3 has selected results from these efforts. Officials
from these organizations have not studied why potentially eligible
people chose not to apply for food stamps.
Table 3: Selected Results from Prescreening Tools Used by Community-
Based Organizations:
Program: Florida Impact;
Time period: 9/3/02--9/8/03;
Number screened: 1,277;
Number potentially eligible: 1,025[A];
Number applied for food stamps: 306;
Number approved for food stamps: 284 average benefit-- $176.
Program: Mass. Project Bread;
Time period: 1/15/02--8/11/03;
Number screened: 46,505[B];
Number potentially eligible: 39,994;
Number applied for food stamps: 170[C];
Number approved for food stamps: 120[D].
Program: New York City's Community Food Resource Center;
Time period: 2002;
Number screened: 12,107;
Number potentially eligible: 9,504[E] estimated benefit--$166;
Number applied for food stamps: [F];
Number approved for food stamps: [F].
Source: Community-based organizations visited.
[A] Number of potentially eligible individuals with earned income is
not available.
[B] Fifty-five percent of those screened reported earned income.
[C] Project Bread officials did not know why so few potentially
eligible individuals were counted as applying for food stamps but
speculated that local offices may not have input the code on the
application form that would identify Project Bread as the source of the
application.
[D] For the period January 2002-June 2003.
[E] Thirty-two percent of the potentially eligible had earned income;
the average was $1,022 per month.
[F] Information not available.
[End of table]
Steps to Demonstrate the Value of Food Stamp Participation:
Because some working families believe that their food stamps benefits
are likely to be too low to make participation worthwhile, some local
offices have taken steps to promote the related benefits of food stamp
participation, such as reduced utility bills in some states and
categorical eligibility for school meals. While such efforts may
convince potential participants of the value of food stamps, many of
the stakeholders we interviewed believe that more people would
participate in the program if the minimum food stamp benefit was raised
from $10 to at least $25. Doing this, however, would increase program
costs according to FNS.
Program Officials Have Taken Steps to Reduce the Stigma Associated with
Food Stamps:
Program stakeholders are taking steps to address the stigma associated
with receiving food stamp benefits, trips to the "welfare office," and
being a "food stamp recipient." Program officials and stakeholders
noted changes that have already been made in the program to limit the
stigma and suggested additional changes. While officials we spoke with
were hopeful about these efforts, little outcome data are available to
determine their effectiveness at easing administrative burdens.
Steps to Re-Brand the Program:
PRWORA mandated that states replace food stamp coupons with the EBT
card, a change that introduced a greater element of privacy during food
purchases. Many of the stakeholders we spoke with believe the EBT card
has helped to reduce the stigma associated with the use of food stamps.
Use of the EBT card has also had the effect of reducing food stamp
fraud. As of September 2003, 95 percent of all food stamp benefit
issuance is provided via the EBT card. Some states and local outreach
organizations have taken the additional step of re-branding, or
renaming, their EBT cards. Oregon promotes its card as the Oregon Trail
Card, and the Community Food Resource Center in New York City promotes
the EBT card as "the Food Card.":
Beyond renaming the card, many officials suggested that stigma could be
reduced if the program's name was more suggestive of a nutrition
program rather than a welfare program. Four states across the nation
have already renamed their programs.[Footnote 35] For example, Michigan
has changed the name of its Food Stamp Program to the "food assistance
program." FNS is currently considering renaming the program and is
consulting with its state partners on what the name should be.
Steps to Disassociate Food Stamps from Welfare:
To corroborate the Food Stamp Program as a nutrition program and to
eliminate trips to "the welfare office," some officials suggested
moving the Food Stamp Program out of the state welfare office and
placing it under the Health Department. However, because states decide
where their various nutrition programs reside, this program change
would be difficult to implement nationally.
New York State is testing a model that allows potential applicants to
avoid the welfare office. The state has developed Transitional
Opportunity Program centers for former TANF recipients who are working
and who are still eligible for work supports, such as food stamps. The
idea behind these centers is to provide benefits and case management
for low-income workers in a friendlier, more positive environment where
the focus is on helping low-income workers achieve self-sufficiency. To
do so, caseworkers provide active case management, bank officials
provide seminars on how to open and manage a bank account, tax
preparers discuss the EITC, former welfare recipients discuss paths to
success, childcare providers highlight strategies for childcare, and
nutritionists discuss healthy eating habits. The case managers are also
available to help if a rent or utility emergency arises.
Finally, some food stamp researchers have suggested a fundamental
reshaping of the way the Food Stamp Program is administered and
overseen.[Footnote 36] They suggested delivering program benefits to
those who work regularly through the tax code, much like the EITC
program. Such a change would eliminate the need for working individuals
to go to the food stamp office. However, such a fundamental reshaping
of the program from food assistance to cash assistance has significant
implications for program mission and integrity, targeting intended
beneficiaries, and administration and would require significant study
and review.
Serving Working Families Need Not Jeopardize Program Integrity:
State officials believe that food stamp cases with earned income are
more complex and error prone than cases with no income. Food stamp
quality control data show that in fiscal year 2001 cases with only
earned income accounted for about twice the percentage of dollars
attributed to errors as cases with no income. These cases are more
complex because low-income working families' incomes tend to fluctuate
as the numbers of hours they work rise and fall. Therefore, tracking
eligibility status, proper benefit level, and accurate income level is
more difficult. This is important to note because officials in three of
the four states we visited were supportive of the goal of increasing
the participation of working families but were also concerned about the
impact these more complex cases could have on their program error
rates. Data indicate, however, that the increase in the proportion of
working recipients from fiscal years 1997 to 2001 did not unduly affect
the program error rate. Food Stamp Program quality control data show
that over this same period the percentage of dollar payments made in
error to households with only earned income remained about the same
while the overall program error rate declined. These data suggest that
program integrity can be maintained as states strive to better serve
working families.
The program simplification options that many states have adopted also
have the potential to reduce program error while easing the
administrative burden on states and on working families. Some of the
options ease the administrative burdens on families by reducing the
number of times they have to report changes in their cases, in turn
reducing the number of potential errors that can occur responding to
those changes. Other options ease program participation by simplifying
the eligibility determination process. By adopting these options,
states are hoping to reduce program errors while better serving working
families.[Footnote 37]
Conclusions:
Passage of the 1996 welfare reform law changed the safety net landscape
for families by placing greater emphasis on work and self-sufficiency.
In this new environment, the Food Stamp Program can play an important
role in supporting low-income working families, either in their attempt
to avoid receiving cash assistance or as they leave cash assistance and
strive for self-sufficiency. Current efforts focus attention and
resources on increasing participation among all eligible families,
particularly working families. Yet, almost half of those working
families that are likely eligible to receive benefits do not
participate in the program. Many of the federal, state, and local
officials we spoke with believe the program could do more to serve
eligible working families, and FNS's goal is to make it easier for low-
income and working families to access the benefits to which they are
entitled.
We observed a number of initiatives that show promise in addressing one
or more of the reasons why working families do not participate in the
program. Most of the initiatives we observed have only been tried on a
small scale at various scattered locations. While we know many efforts
are being undertaken, a complete picture is unavailable because FNS
does not systematically track state activities, nor does it require
that states collect and evaluate outcome data on their own efforts.
Although FNS is beginning to assess the outcomes of some of the
outreach grant efforts, not enough is currently known about all the
practices being tried and whether they have achieved their goals. In
addition, in those cases where initiatives have achieved positive
outcomes, there is no systematic vehicle for disseminating lessons-
learned to other programs or community-based organizations interested
in taking similar steps. Efforts to systematically collect and report
simple outcome data on such initiatives could be a significant resource
for other states that want to increase the food stamp participation
among their eligible working families.
However, despite FNS's and states' best efforts, some eligible working
families may continue to choose not to participate in the Food Stamp
Program and may have good reasons for making that choice. Other
eligible families could benefit significantly if they did participate.
Some of the factors that influence a family's decision about whether to
apply for food stamps are unrelated to the program's design. Some
families may make a personal decision that the effort and cost to them
of applying for and receiving benefits, including complying with the
measures in place to promote program integrity, is not worth the
ultimate gain. This seems to be especially true for families with
higher earnings. Each family must make its own personal calculation
based on its unique circumstances, and some families will likely
continue to opt out of receiving benefits.
Recommendations to the Secretary of Agriculture:
To better target federal, state, and local outreach efforts; maximize
the benefits of the available outreach dollars; and identify and
eliminate impediments to food stamp participation, we recommend that
the Secretary of Agriculture direct FNS to:
* encourage states to collect and report on the results of their
outreach and other efforts to increase participation among eligible
working families and:
* disseminate the lessons learned from those efforts to other states
and localities.
Agency Comments:
We provided a draft of this report to the U.S. Department of
Agriculture for review and comment. On February 9, 2004, we met with
FNS officials, including the acting deputy administrator for the Food
Stamp Program, to get their comments. The officials said that they
generally agreed with our findings, conclusions, and recommendations.
FNS also provided us with technical comments, which we incorporated
where appropriate.
The FNS officials reiterated their commitment to increase working
families' participation in the Food Stamp Program and suggested that we
provide a fuller recognition of their efforts to increase this
participation. The officials said they believe their ongoing efforts to
better inform the public about food stamp availability and the
program's eligibility criteria are contributing significantly to the
overall goal of increasing program participation. In addition, the
officials highlighted their efforts to work with state and local food
stamp agencies and other partners--such as nonprofit organizations,
retailers, and employers--to assist in developing and implementing
outreach strategies. The officials also cited their efforts to
encourage the states to simplify the administrative process and adopt
user friendly options. In addition, we were asked to highlight
additional examples of FNS's efforts, and we did, where appropriate.
Agency officials agreed that our recommendation that FNS track outreach
activities and collect outcome data could provide valuable information.
However, the officials expressed concern that imposing additional data
collection, reporting, and evaluation requirements could be seen as
burdensome by states or local agencies and may discourage some from
undertaking desirable, but optional, activities like outreach. We agree
that requiring rigorous research and evaluation of all outreach efforts
would be costly and difficult. However, we believe encouraging states
to report simple and uniform outcome data on the results of USDA-funded
efforts could be a cost-effective means of collecting information of
value to others attempting to increase working families' participation
in the program. For efforts that are funded locally, USDA could provide
a suggested template of data to collect so that similar data elements
would be gathered across various locations. For example, the sites we
visited did not systematically collect similar information on the
number of working families reached by different activities and the
disposition of their cases. USDA could also use cost-effective means of
sharing lessons-learned with states and localities by posting this
information on its Web site.
We are sending copies of this report to the Secretary of Agriculture;
appropriate congressional committees; and other interested parties. We
will also make copies available to others upon request. In addition,
the report will be available at no charge on GAO's Web site at
http: //www.gao.gov. Please contact me at (202) 512-7215 if you or your
staffs have any questions about this report. Other major contributors
to this report are listed in appendix III.
Signed by:
Sigurd R. Nilsen:
Director, Education, Workforce, and Income Security Issues:
[End of section]
Appendix I: Methodology for Comparing Participating Working Families to
Likely Eligible Nonparticipating Working Families:
Our analysis relied on simulated data produced by Mathematica Policy
Research, Inc., based on the March 2001 Current Population Survey
(CPS).
The simulated data were used to establish a universe of all working
families that are likely eligible to receive food stamps for the
purpose of comparing the characteristics of participating working
families to likely eligible nonparticipating working families.
Mathematica created this simulated data, in part, because comparisons
between the CPS estimates of Food Stamp Program participation and
administrative data from the program suggest that program participation
is underreported in the CPS, and eligibility for program benefits
cannot be directly observed or reported in existing survey data. To
complete the simulation, Mathematica assigned individuals in each CPS
household to one or more "food stamp units." For each food stamp unit,
Mathematica used CPS data and information from other sources to assign
simulated values for variables such as monthly shelter expenses and
monthly earned income. Mathematica Policy Research, Inc., then tested
each food stamp unit to assign the unit as eligible or ineligible to
receive food stamps.
The cumulative characteristics of all households with eligible food
stamp units, as determined by Mathematica's simulated data, are shown
in table 4, and include income-related and demographic factors
associated with the households and variables that reflect whether
anyone in the household was participating in other government
assistance programs.
Table 4: Characteristics of Eligible Households with Earnings Used as
Factors to Predict Food Stamp Program Participation (Observed N=2,498;
weighted N=4,911,252):
Factor: Monthly food stamp benefits*;
Mean/percent (weighted estimates): $153.
Factor: Monthly shelter expenses*;
Mean/percent (weighted estimates): $508.
Factor: Monthly earned income *;
Mean/percent (weighted estimates): $956.
Factor: Any nonearned income*;
Mean/percent (weighted estimates): 37%.
Factor: Number of people;
Mean/percent (weighted estimates): 3.6.
Factor: Elderly;
Mean/percent (weighted estimates): 10%.
Factor: Under age 5;
Mean/percent (weighted estimates): 37%.
Factor: Married;
Mean/percent (weighted estimates): 42%.
Factor: All white - Non-Hispanic;
Mean/percent (weighted estimates): 42%.
Factor: All black (including black Hispanics);
Mean/percent (weighted estimates): 24%.
Factor: All white Hispanic;
Mean/percent (weighted estimates): 26%.
Factor: Other/mixed race;
Mean/percent (weighted estimates): 8%.
Factor: Noncitizen;
Mean/percent (weighted estimates): 8%.
Factor: Own home;
Mean/percent (weighted estimates): 34%.
Factor: Multifamily;
Mean/percent (weighted estimates): 23%.
Factor: Job training;
Mean/percent (weighted estimates): 2%.
Factor: Free lunch;
Mean/percent (weighted estimates): 38%.
Factor: Energy assistance;
Mean/percent (weighted estimates): 8%.
Factor: Women, Infants, and Children Program (WIC);
Mean/percent (weighted estimates): 19%.
Factor: Medicaid;
Mean/percent (weighted estimates): 43%.
Factor: Children's Health Insurance Program (CHIP);
Mean/percent (weighted estimates): 6%.
Factor: Supplemental Security Income*(SSI);
Mean/percent (weighted estimates): 9%.
Source: GAO.
Note: Asterisks denote variables with simulated values that were
developed by Mathematica Policy Research, Inc. All estimated means in
the table have sampling errors that, with 95 percent confidence, do not
exceed 4 percent of the value of the estimated means. All estimated
percentages in the table have sampling errors that do not exceed 3
percentage points, with 95 percent confidence.
[End of table]
According to table 4, on average, the households with earnings--working
families--that were deemed eligible to participate in the Food Stamp
Program were eligible to receive $153 in food stamps per month. The
monthly shelter expenses of these families averaged $508, and the
monthly income for these families averaged $956. Slightly more than
one-third (37 percent) of the families reported some nonearned income,
and a similar percentage (34 percent) of the families involved had
homes or dwellings that were owned rather than rented. The rest of the
results can be discerned similarly.
The Analysis Allows for Comparisons between Households with
Participating and Nonparticipating Working Families:
In addition to assigning a determination of whether a unit within a
household is eligible to receive food stamps, Mathematica Policy
Research, Inc., made an assignment, based on its known participation
patterns, as to whether eligible food stamp units were receiving food
stamp benefits as of a fixed reference month. However, we could not use
Mathematica's simulated variable that identifies units receiving food
stamp benefits to conduct the substance of our analysis, which was
primarily focused on the difference among participating and likely
eligible nonparticipating food stamp units. This is because
Mathematica's procedures were not amenable to multivariate procedures
that would allow an estimate of the "net" effects of different factors
on Food Stamp Program participation - for example, the effect that food
stamp benefit amounts have on the likelihood of participating after the
associations of benefit amounts and participation likelihoods with
other potentially confounding factors are taken into account. Instead,
to conduct this analysis, we relied on CPS estimates of participating
working households and compared those households with those that were
eligible, but not participating, based on Mathematica's work. Given
that, it should be recognized that the results below are affected by
our having chosen to use CPS's variable to identify participants and
Mathematica's variable to identify eligibility. Among households with
working families an estimated 26 percent of the households with an
eligible unit (as defined by Mathematica) were identified as
participating by CPS's variable. By contrast, an estimated 31 percent
were identified as participating by Mathematica's simulated variable.
This difference masks somewhat the extent of the discord between the
two variables; an estimated 38 percent of all households that
Mathematica's simulation indicates as participating were not coded as
participating by CPS, and an estimated 2 percent of the households that
Mathematica's simulation indicates as nonparticipating were coded as
participating in CPS. Additionally, an estimated 30 percent of the
households that CPS recorded as participating were deemed ineligible to
participate by Mathematica's simulation process. Still, the work that
went in to Mathematica's simulation gives us confidence that the
results presented in table 5 are a reasonable approximation of the
different characteristics between participating and nonparticipating
eligible working families. It is worth noting that variations from the
procedures produced by Mathematica for estimating eligibility could
yield results that differ from our analysis since our work relies on
Mathematica's simulation of eligibility.
To estimate the net effect of different factors affecting the
likelihood of participating, we used logistic regression models that
produce odds ratios to indicate how the odds on participating differed
across different types of households, or across various levels of
continuous variables (like income or the value of food stamp benefits
that households were eligible for) that are associated with each unit.
Overall, the odds on participating were 0.35; that is, 35 eligible
households participated for every 100 that did not.[Footnote 38] These
odds differed markedly across different households, however, and the
odds ratios from bivariate models shown in table 5 indicate the
bivariate effects of various factors on the odds on eligible food stamp
working families participating in the Food Stamp Program, when each
factor is considered in isolation, or independently, from every other
factor. Model 1 and model 2 test for the effect of any characteristic
using multivariate models, in order to control for other factors in
measuring whether any single factor effects likelihood of
participation.
Table 5: Odds Ratios Indicating the Effects of Various Factors on Food
Stamp Participation among Eligible Earning Households, from Bivariate
and Multivariate Logistic Regression Models (Observed N=2,498; weighted
N=4,911,252):
Factor: Monthly food stamp benefits (in $100s);
Odds ratios: Bivariate model: 1.310*;
Odds ratios: Multivariate models: Model 1: 1.367*;
Odds ratios: Multivariate models: Model 2: 1.316*.
Factor: Monthly shelter expenses (in $100s);
Odds ratios: Bivariate model: 0.908*;
Odds ratios: Multivariate models: Model 1: 0.923*;
Odds ratios: Multivariate models: Model 2: 0.934*.
Factor: Monthly earned income (in $1000s);
Odds ratios: Bivariate model: 0.869;
Odds ratios: Multivariate models: Model 1: 1.128;
Odds ratios: Multivariate models: Model 2: 1.113.
Factor: Any nonearned income;
Odds ratios: Bivariate model: 2.564*;
Odds ratios: Multivariate models: Model 1: 2.964*;
Odds ratios: Multivariate models: Model 2: 1.705*.
Factor: Number of people;
Odds ratios: Bivariate model: 1.101*;
Odds ratios: Multivariate models: Model 1: 1.027;
Odds ratios: Multivariate models: Model 2: 0.877*.
Factor: Elderly;
Odds ratios: Bivariate model: 0.479*;
Odds ratios: Multivariate models: Model 1: 0.595*;
Odds ratios: Multivariate models: Model 2: 0.780.
Factor: Under age 5;
Odds ratios: Bivariate model: 1.875*;
Odds ratios: Multivariate models: Model 1: 1.533*;
Odds ratios: Multivariate models: Model 2: 0.989.
Factor: Married;
Odds ratios: Bivariate model: 0.566*;
Odds ratios: Multivariate models: Model 1: 0.563*;
Odds ratios: Multivariate models: Model 2: 0.678*.
Factor: All black (including black Hispanic);
Odds ratios: Bivariate model: 1.775*;
Odds ratios: Multivariate models: Model 1: 1.311;
Odds ratios: Multivariate models: Model 2: 1.327.
Factor: All white Hispanic;
Odds ratios: Bivariate model: 0.839;
Odds ratios: Multivariate models: Model 1: 1.226;
Odds ratios: Multivariate models: Model 2: 0.962.
Factor: Other/mixed race;
Odds ratios: Bivariate model: 0.861;
Odds ratios: Multivariate models: Model 1: 0.995;
Odds ratios: Multivariate models: Model 2: 0.818.
Factor: Noncitizen;
Odds ratios: Bivariate model: 0.489*;
Odds ratios: Multivariate models: Model 1: 0.516*;
Odds ratios: Multivariate models: Model 2: 0.624*.
Factor: Own home;
Odds ratios: Bivariate model: 0.446*;
Odds ratios: Multivariate models: Model 1: 0.575*;
Odds ratios: Multivariate models: Model 2: 0.704*.
Factor: Multifamily;
Odds ratios: Bivariate model: 0.978;
Odds ratios: Multivariate models: Model 1: 0.763;
Odds ratios: Multivariate models: Model 2: 0.795.
Factor: Job training;
Odds ratios: Bivariate model: 4.268*;
Odds ratios: Multivariate models: Model 1: [Empty];
Odds ratios: Multivariate models: Model 2: 2.868*.
Factor: Free lunch;
Odds ratios: Bivariate model: 2.930*;
Odds ratios: Multivariate models: Model 1: [Empty];
Odds ratios: Multivariate models: Model 2: 2.346*.
Factor: Energy assistance;
Odds ratios: Bivariate model: 6.374*;
Odds ratios: Multivariate models: Model 1: [Empty];
Odds ratios: Multivariate models: Model 2: 3.190*.
Factor: WIC;
Odds ratios: Bivariate model: 3.260*;
Odds ratios: Multivariate models: Model 1: [Empty];
Odds ratios: Multivariate models: Model 2: 2.330*.
Factor: Medicaid;
Odds ratios: Bivariate model: 10.794*;
Odds ratios: Multivariate models: Model 1: [Empty];
Odds ratios: Multivariate models: Model 2: 7.182*.
Factor: CHIP;
Odds ratios: Bivariate model: 0.993;
Odds ratios: Multivariate models: Model 1: [Empty];
Odds ratios: Multivariate models: Model 2: 0.332*.
Factor: SSI;
Odds ratios: Bivariate model: 2.129*;
Odds ratios: Multivariate models: Model 1: [Empty];
Odds ratios: Multivariate models: Model 2: 1.260.
Source: GAO.
Note: Asterisks denote estimated odds ratios which, with 95 percent
confidence, are significantly different from 1. The logistic regression
analyses used CPS weights and included information that provided
approximate adjustments for the complex sample design of CPS.
[End of table]
These bivariate results demonstrate that, based on our estimates, food
stamp participation was more likely in eligible households in which the
benefits of participation were greater; that is, each $100 increase in
monthly benefits for which household members were eligible increased
the odds on participating by a factor of 1.31, or by 31 percent. Likely
eligible households with higher shelter expenses were, at the same
time, less likely to participate; each $100 increase in monthly shelter
expenses decreased the odds on participating by a factor of 0.91. While
households with higher incomes were not significantly different from
households with lower incomes to participate, households with any
nonearned income were 2.6 times as likely as those without any
nonearned income to participate. Larger households were also more
likely to participate than smaller ones (i.e., every additional person
in the eligible household increases the odds on participating by a
factor of 1.1). While the presence of elderly or married individuals in
a household reduces the odds on participation by roughly half, the
presence of young children (under age 5) in the household nearly
doubles the odds of participating. Households consisting of all black
members (including black Hispanics) were nearly twice as likely as
families with all white (non-Hispanic) members to participate, though
there were no significant differences between households consisting of
other races and households that were all white. Households with any
noncitizen unit head, and households involving owned rather than rented
dwellings, were also less likely to be participating in food stamps
than other households.
Participation in the Food Stamp Program was also greatly affected by
whether the persons in the eligible household participate in other
programs. That is, the odds of participating were over 10 times higher
for those working households that received Medicaid benefits (than for
those who do not), over six times higher for those who received energy
assistance, and over four times higher for households in which someone
was receiving job training. Similarly, the odds of participating in the
Food Stamp Program were about three times higher for those working
households participating in free lunch programs or in WIC than for
those not participating in those programs, and they were roughly twice
as great for those who received any SSI benefits.
The first multivariate model (Model 1) provides estimates of the
effects of the various socioeconomic and demographic factors when they
are estimated simultaneously, using a multivariate logistic regression
model. While odds ratios estimating the different effect sizes change
modestly in some cases, most of the factors that appeared significant
when they were estimated from bivariate models remain significant when
they are estimated in a multivariate context and the effects of other
factors are controlled.
Model 2 of the multivariate analysis shows the estimates of the effects
of participating in other programs, net of each other, and net of the
effects of the socioeconomic and demographic factors. Here too, most of
these effects remain consistent with what was found in the bivariate
analyses, except that receiving SSI does not appear to affect Food
Stamp Program participation net of the other factors and, when other
factors are controlled, households involved in the Children's Health
Insurance Program appear to be only a third as likely as households
that do not receive food stamps. While our estimates of the effects of
participating in other programs on food stamp participation are
somewhat attenuated or diminished when they are estimated
simultaneously, rather than independent of one another, it remains the
case that households, including someone who receives Medicaid, energy
assistance, or job training are the most likely to receive food stamps.
We believe that, these multivariate estimates of the effects of program
participation are, by virtue of being estimated simultaneously and
while controlling for the socioeconomic and demographic characteristics
of the eligible households, somewhat better estimates than those
obtained in our bivariate analyses.
[End of section]
Appendix II: Summary of Farm Bill Provisions:
Option/provision: Encouragement of payment of child support (option);
Description: Treats legally obligated child support payments to a
nonhousehold member as an income exclusion rather than a deduction.
Option/provision: Simplified definition of income (option);
Description: Excludes types of income that are not used to determine
eligibility for TANF or Medicaid, with some exceptions.
Option/provision: Simplified definition of resources (option);
Description: Excludes certain types of resources that the state does
not count for TANF or Medicaid.
Option/provision: Simplified determination of housing costs (option);
Description: Allows states to use a standard deduction from income of
$143 per month for homeless households with some shelter expenses.
Option/provision: Simplified determination of deductions (option);
Description: Disregard reported changes in deductions during
certification periods except for changes associated with a new
residence or earned income until the next recertification.
Option/provision: State option to reduce reporting requirements
(option) [1];
Description: Expand simplified/semiannual reporting systems to most
households, not just those with earned income[1].
Option/provision: Transitional food stamps for families moving from
welfare (option) [1];
Description: Continue food stamp benefits to households for up to 5
months after they lose TANF cash assistance[1].
Option/provision: Simplified utility allowance (option);
Description: Simplifies the Standard Utility Allowance to promote its
use.
Option/provision: Alternative procedures for residents of certain group
faculties;
Description: Pilot project to assess feasibility of issuing
standardized rather than individual benefits to certain residents of
group homes.
Option/provision: Availability of food stamp program applications on
the Internet[1];
Description: Require state agencies that have a Web site to post
applications on these sites[1].
Option/provision: Grants for simple application and eligibility
determination systems and improved access to benefits;
Description: Authorizes up to $5 million annually to pay for projects
to improve access for food stamp-eligible households or to develop and
implement simplified application and eligibility systems.
Option/provision: Reform of quality control (QC) system[1];
Description: This provision makes substantial changes to the QC system
that measures states' payment accuracy in issuing food stamp benefits.
Only those states with persistently high error rates would face
liabilities[1].
Option/provision: Bonuses for states that demonstrate high or most
improved performance;
Description: Creates a performance system that will award $48 million
in bonuses each year to states with high or improved performance for
actions taken to correct errors, reduce the rates of error, and improve
eligibility determinations.
Option/provision: Partial restoration of benefits to legal immigrants;
Description: This provision restores food stamp eligibility on certain
dates to qualified aliens who are otherwise eligible and meet criteria
laid out in the legislation.
Source: Section-By-Section Summary of Provisions Affecting Food Stamp
Provisions. Compiled by USDA's Food and Nutrition Service.
Note:
[1] These provisions are those we identified as having the potential
to have particularly positive impact on participation among working
families.
[End of table]
[End of section]
Appendix III: GAO Contacts and Acknowledgments:
GAO Contacts:
Kay Brown, (202) 512-3674, brownke@gao.gov Kevin Kumanga, (202) 512-
4962, kumangak@gao.gov:
Acknowledgments:
Bob Kolasky and Thaddeus Hackworth also made significant contributions
to this report. In addition, Paula Bonin, Robert DeRoy, Kevin Jackson,
Beverly Ross, Sidney Schwartz, and Douglas Sloane produced our
estimates of participation among working families, and Corinna Nicolaou
assisted in the message and report development.
[End of section]
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FOOTNOTES
[1] A food stamp household consists of individuals who live together
and customarily purchase and prepare food in common.
[2] FNS oversees the program at the federal level, while each of the 50
states--plus Washington, D.C., Guam, and the Virgin Islands--administer
their own programs, either at the state or county level.
[3] See appendix I for a detailed explanation of the methodology we
used to analyze public data.
[4] Food stamp applications can also be taken at other locations such
as health clinics and one-stop centers established by the Workforce
Investment Act to serve job seekers accessing employment and training
services.
[5] As GAO and others have reported previously, following the passage
of PRWORA, there is evidence that food stamp participation dropped as
eligible recipients did not apply for food stamps because they
incorrectly assumed that if they are ineligible for TANF, they are also
ineligible for food stamps. See U.S. General Accounting Office, Food
Stamp Program: Various Factors Have Led to Declining Participation,
GAO/RCED-99-185 (Washington D.C.: July 1999) for more details.
[6] The strategic plan sets a baseline of 63 percent in 1997.
[7] The EITC is a federal income tax credit for low-income workers who
are eligible for and claim the credit. The credit reduces the amount of
tax an individual owes and may be returned in the form of a refund.
[8] See appendix II for details on the Farm Security and Rural
Investment Act of 2002.
[9] The food stamp error rate is calculated for the entire program, as
well as every state, by adding overpayments to those who are eligible
for smaller benefits, over payments to those who are not eligible for
any benefit, and underpayments to those who do not get as many benefits
as they should. In fiscal year 2002, the overpayment was 6.16 percent
and the underpayment was 2.10 percent. The program also calculates a
negative action error rate, defined as the rate of improper denials or
terminations of benefits.
[10] K. Cunnyngham, Mathematica Policy Research, Inc., for The Food and
Nutrition Service, Trends in Food Stamp Program Participation
Rates: 1999 to 2001 (Alexandria, Va.: July 2003). This study identified
an increase in the participation rate among people eligible for
benefits in households with earnings from 47.3 percent in fiscal year
1999 to 51.8 percent in fiscal year 2001.
[11] The participation rates reported are based on the actual number of
individuals participating in the Food Stamp Program and estimates of
the number of individuals eligible for food stamps. FNS contracts with
Mathematica Policy Research, Inc., to calculate participation rate data
for the program. The participation rate figure is determined by
dividing the actual number of individuals who participate by the
estimated number of individuals who are eligible. The actual number of
participants comes from Food Stamp Program operations data. The
estimate of eligible individuals is derived from a model that uses
March Current Population Survey data to simulate household
characteristics. The Mathematica participation rate calculation is the
generally accepted standard by USDA. Because of delays in the
availability of needed survey data, a lag exists between actual
participation numbers being available and the calculation of
participation rates.
[12] U.S. Department of Agriculture, Food and Nutrition Service Office
of Analysis, Nutrition, and Evaluation, Characteristics of Food Stamp
Households: Fiscal Year 2002 (Alexandria, Va.: December 2003).
[13] For a detailed description of the process, used to complete this
analysis, see appendix I.
[14] Michael Ponza, et al., Mathematica Policy Research, Inc., Customer
Service in the Food Stamp Program (Princeton, NJ: July 1999).
[15] Signe-Mary McKernan, et al., The Urban Institute: Employment
Factors Influencing Food Stamp Participation (Washington, D.C.: August
2003).
[16] The four states with finger-imaging requirements are Arizona,
California, New York, and Texas.
[17] For more information on program integrity and participation
challenges, see U.S. General Accounting Office, Food Stamp Program:
Program Integrity and Participation Challenges, GAO-01-881T
(Washington D.C.: June 27, 2001).
[18] Sheena McConnell, Michael Ponza, and Mathematica Policy Research,
Inc., The Reaching the Working Poor and Poor Elderly Study: What We
Learned and Recommendations for Future Research, (Washington, D.C.:
December 1999).
[19] Food insecurity is defined as a family being, at some point during
the previous year, uncertain of having, or unable to acquire, enough
food to meet basic needs of all its members because they had
insufficient money or other resources.
[20] Mark Nord, et al., USDA Food Assistance & Nutrition Research
Program, Household Food Security in the United States, 2001
(Washington, D.C.: October 2002).
[21] Mary Farrell, David Stapleton et al., The Lewin Group and Cornell
Center for Policy Research The Relationship of Earnings and Income to
Food Stamp Participation: A Longitudinal Analysis (Washington, D.C.:
August 2003).
[22] The SIPP is conducted by the Census Bureau. It collects source and
amount of income, labor force information, program participation and
eligibility data, and general demographic characteristics to measure
the effectiveness of existing federal, state, and local programs. This
study followed a panel of households from 1996 over a 4-year period.
[23] In fiscal year 2004, FNS hopes to gain new partners by awarding
smaller grants for food stamp outreach to smaller-sized, community-
based and faith-based organizations, with the anticipation of obtaining
new ideas for implementing outreach activities. One of the strategies
promoted in the grant solicitation is the use of employers to
facilitate the application process.
[24] State Best Practices Improving Food Stamp Program Access, USDA,
FNS, (June 2002).
[25] Advocacy groups such as the American Public Human Services
Association, the Food Research Action Center, and the Nutrition
Consortium of New York State also make information available on food
stamp outreach and access in best practices guides, on their Web sites,
or through conferences.
[26] In fiscal year 2003, FNS also made a wide variety of free flyers,
posters, and brochures available to state and local food stamp agencies
and other interested organizations which can be downloaded or ordered
online from the agency's Web site. These educational materials, which
include "Food Stamps Make America Stronger," "Who Qualifies for Food
Stamps?" and "A Small Reason to Find Out if You Qualify for Food
Stamps," are available in English and Spanish and are targeted to the
working poor, immigrants, and seniors, as well as the general low-
income population.
[27] This program, sponsored by the Internal Revenue Service, provides
voluntary assistance with federal income tax returns. FNS has also
initiated additional new efforts to promote food stamps to low-income
individuals through the tax filing process. VITA sites have been
encouraged to display food stamp materials and refer their clients to
the food stamp toll-free number. FNS plans to include an Internal
Revenue Service publication on EITC along with the food stamp materials
mailed to callers of the toll-free number.
[28] Since 2002, FNS has also presented information and provided
training regarding the importance of food stamps as a work support at
the U.S. Chamber of Commerce's Annual Workforce Development Leadership
Course. The course is designed to build the capacity of local chambers
of commerce to support employers in the area of workforce training and
development, with a focus on employers of low-wage workers and former
welfare recipients.
[29] U.S. General Accounting Office, Workforce Investment Act: States
and Localities Increasingly Coordinate Services for TANF Clients, but
Better Information Needed on Effective Approaches, GAO-02-696
(Washington, D.C.: July 2002).
[30] Community-based organizations in Massachusetts and New York City
have such efforts under development that would allow applications to be
sent electronically to local food stamp offices, but the technology is
not yet in place.
[31] This option, called expanded categorical eligibility, helps
simplify eligibility determination by eliminating the requirement to
determine the value of assets and verifying family income up to 200
percent of poverty.
[32] All four states have also expanded the use of semiannual reporting
to all households that can be asked to report periodically, a change
allowed under the 2002 Farm Bill.
[33] This provision is known as simplified determination of deductions
in the 2002 Farm Bill.
[34] For more information on the states' use of options and waivers see
U.S. General Accounting Office, Food Stamp Program: States' Use of
Options and Waivers to Improve Program Administration and Promote
Access, GAO-02-409 (Washington, D.C.: Feb. 22, 2002).
[35] The four states are Kansas, Michigan, Minnesota, and Washington.
[36] Michael E. Fishman and Harold Beebout, Supports for Working Poor
Families: A New Approach (Washington, D.C.: December 2001). Robert I.
Lerman and Michael Wiseman, Restructuring Food Stamps for Working
Families (Washington, D.C.: August 2002). These reports offered
potential policy options for the Food Stamp Program, with an interest
in spurring discussions about improving the delivery of benefits to and
well being of low-income working families. We did not conduct a
detailed review of the reports or make an assessment of the
applicability or validity of any of the policy options offered by the
authors. We selected this example to highlight some advantages and
disadvantages of one alternative scenario for delivering food stamps.
[37] States also have antifraud measures in place to ensure program
integrity. The states we visited use automated data matches to search
for unreported household income and assets. They match their food stamp
caseloads against their wage reporting systems, new-hire data, Internal
Revenue Service Form 1099 data, Social Security and Supplemental
Security Income data, unemployment insurance data, etc. New York State
also uses finger imaging to protect against clients maintaining
duplicate food stamp cases.
[38] The odds on participating are somewhat different from, but related
to, the percentage participating. The odds equal the percentage
participating divided by the percentage not participating. In this
sample of eligible households with earnings, as noted above, 26 percent
of the households were participating in the Food Stamp Program. The
overall odds of participating were 0.35, which equals 26/74, and
implies that 0.35 households were participating for every one that was
not, or that 35 were participating for every 100 that were not. While
odds are somewhat less familiar than percentages, the use of odds and
odds ratios to describe the effects of certain factors on the
likelihood of participation involve certain desirable properties, not
the least of which are that they are, unlike percentages and percentage
differences, unaffected by whether we choose to look at the likelihood
of participating rather than not participating, and by how likely or
unlikely participating is across the subgroups we are comparing.
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